Nirbhay Capital Services Pvt. Ltd. - A SEBI Registered Merchant - - PowerPoint PPT Presentation

Nirbhay Capital Services Pvt. Ltd.

• A SEBI Registered Merchant Banker

Presenta tion On Pub lic Issue of Sm a ll & Med ium Enterp rises

Nirbhay Capital Services Pvt. Ltd.

• A SEBI Registered Merchant Banker

TABLE OF CONTENTS

OVERVIEW OF SME EXCHANGE ELIGIBILITY & GUIDELINES BENEFITS OF LISTING INTERMEDIARIES, PROCESS & TIMELINE COMPLIANCES & KEY REGULATIONS OUR PR NIRBHAY CAPITAL SERVICES PRIVATE LIMITED

4 5-6 7-8 9-11 12-15 16 -17 17-38

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OVERVIEW OF AN SME IPO

“SME Exchange” means a trading platform of a recognised stock exchange having nationwide trading terminals permitted by SEBI to list the specified securities issued in accordance with Chapter XB of SEBI (ICDR) and includes a stock exchange granted recognition for this purpose but does not include the Main Platform of the SE. Provides great opportunity to entrepreneurs to raise the equity capital for growth of SMEs. Provides immense opportunity to investors to invest in the good companies at early stage and it will help unleash the valuation

• f

the company.

SME EXCHANGE

Post issue paid up capital <=Rs. 10 Cr. Post issue paid up capital >Rs. 10 Cr. & <= Rs. 25 Cr. Listing on SME Exchange

Voluntary

Listing on SME Exchange Migration to Main Board

(with prior approval of Exchange)

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ELIGIBILITY CRITERIA

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Criteria BSE Requirements NSE Requirements Incorporation Companies Act, 1956 or Companies Act. 2013 Companies Act, 1956 or Companies Act, 2013 Post-Issue Paid up Capital (Face Value) Minimum: Rs. 3 Crores Maximum: Rs. 25 Crores Minimum: No Requirement Maximum: Rs. 25 Crores Tangible Net Worth Minimum Rs. 3 Crores. No Requirement Net Tangible Assets Minimum: Rs. 3 Crores. No Requirement Profit Track Record Distributable net profit for 2 out of 3 financial Years

• r

Networth of minimum Rs. 5 Crores. Track record of at least 3 years, positive cash accruals for at least 2 financial years and a positive net worth. Other Listing Conditions Website, Demat trading, Shall not have been referred to BIFR and shall not have a winding up petition Shall not have been referred to BIFR, Shall not have a winding up petition and no disciplinary action faced for 3 years.

SEBI GUIDELINES

• Minimum Dilution :26.25% of Post Issue

Capital (25% to Public and 5% of the share

• ffered to Public to the Market Maker i.e.

1.25% (5% of 25%).

• Minimum Subscribers Required : 50 allottees
• Underwriting : 100% issue should be

underwritten

• Trading Lot :Minimum Trading Lot of Rs.

1,00,000.

• Market Making : Compulsory for 3 years,

provides stability to the stock price.

• Market Maker: Stock broker registered with

SME Exchange.

• Migration to Main Board : After 2 years
• Trading Time: Same as Main Board

Public Issue through SME Exchange shall list the specified securities in accordance with the Chapter XB of SEBI ICDR Regulations. Draft Offer Document although required to be filed with Stock Exchange and SEBI, SEBI shall not issue any observation on the Offer Document.

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BENEFITS OF LISTING TO COMPANIES

• Capital for expansion and long term working capital
• Reduces debt burden
• Improves credit rating and lowers financing cost
• Enhanced market perception leads to higher sales

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IMPACT ON FINANCIALS

• Increased Visibility of the Company boosting marketing efforts
• Value creation for Existing Shareholder and encouragement for innovation
• Raises company's profile with customers, suppliers, investors, financial institutions and the

media.

• Incentive for employees as listed shares can be used as an effective HR tool.
• Expands Investor Base generating capital creation as secondary placements
• Generates an independent valuation of the company by the market
• Greater Participation by PE/VC in SMEs as an exit route is available
• Marketability of the company would be enhanced
• Greater transparency & disclosures leading to business & financial best practices.
• Good growth companies have a chance to migrate to Main board.
• Taxation Benefits to Investors - long term capital gain exempt from tax upon listing of shares.
• Cost of Listing on SME Platform Lower than Main Board.

IMPACT ON BRANDING IMPACT ON FUNDING OTHER BENEFITS

BENEFITS OF LISTING TO SHAREHOLDERS

Long Term Capital Gains Tax & significant decrease in Short Term Capital Gains Tax Capital Gains Tax Unlisted Listed Long term capital gains 20% 10% * Short term capital gains 30%** 15% Wealth Creation

• Greater

liquidity in the public market can lead to better valuation for shares

• In turn, it will enhance the wealth
• f the investors multifold.

Liquidity .

Benefits of Long Term Capital Gains Tax

• Promoters

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Holding of 20% of Post Issue Share Capital to be locked in for 3 years, post which Long Term Capital Gains (LTCG) @10% from tax on sale of shares. Holding in excess of 20%, to be locked in for 1 year, post which LTCG @10% from Tax on sale of shares.

• Existing

(Non Promoter) Shareholders: Sale

• f

shares after listing and completion of statutory 1 year lock in, will not attract Long Term Capital Gains Tax. *effective from 01.04.18 ** depending upon the income slab of the assesse.

• Becoming a public Company

establishes a market for the Company’s shares

• Provides its investors an efficient

and regulated place to trade shares.

REGULATORY BODIES & INTERMEDIARIES

Merchant Banker

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Ad Agency, Grading Agency & Others Stock Exchange, SEBI Market Maker(s) Bankers, Registrars & Legal Advisors Underwriter to the Issue Auditors & Company Secretary Registrar of Companies

KEY MILESTONES IN IPO PROCESS

    

Understanding, Analysis and Structuring Pre IPO-readiness assessment Preparation Detailed due diligence: Financial, Business and Legal Draft Offer Document and Offer Document Marketing the Issue Pricing the issue Listing

  

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NCSPL, as the Lead Manager, works w ith the Company through every stage mentioned here

An IPO life cycle could take between four to six months, from planning the IPO to the initial listing during which number of decisions have to be made and criteria must be satisfied.

INDICATIVE IPO TIMELINE

T T + 5 T + 10 T + 45 T + 47 T + 62 T + 67 T + 68 T + 83 T + 84 T + 94 T + 95 T + 97 T + 101 T + 104

Board Meeting to approve Issue Kick off Meeting Research Presentation File DRHP/ Draft Prospectus with SE Due Diligence & Drafting Observations/ Approval from SEs Incorporate SE comments, if any, in RHP/ Prospectus File RHP/ Prospectus with ROC Marketing of the Issue Obtain listing and trading approvals File RHP / Prospectus with SEBI & SE Receive SE go- ahead to RHP/ Prospectus Issue Opens Issue Closes Allotment Transfer funds from Public Issue A/c to Company/ Offeror A/c T: Trigger Date Notes: These timelines are based on the initial estimates. Final timelines shall be ascertained at appropriate time

CONTENTS OF THE OFFER DOCUMENT

A Draft Offer Document is to be filed with BSE/NSE, through a Lead Merchant Banker, containing the following:

About the Company Detailed history since inception, its products and services, subsidiaries, group companies, dividend policy, etc. About the Industry Detailed industry review in which the business operates including Strengths, Opportunities and possible limitations. Objects of the Issue Information regarding Objects of the Issue and the basis of the price of the issue Capital Structure Detailing about the evolvement of the present capital structure of the Company Management Details about the management – promoters, directors, promoter group and group companies Financials Restated financials for last 5 years, statement of tax benefits and material developments since last balance sheet Issue Information Terms of the issue, structure, procedure, restrictions, etc. Legal & Other Info. Details about outstanding litigations by and against the Company/its Promoters/Directors/Group Concerns, etc. Regulatory Disclosures Regulatory and Statutory laws and disclosures relating to the Company

1 2 3 4 5 6 7 8 9 10

Other Information Material Contracts and documents for inspection

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KEY REGULATIONS UNDER ICDR

Migration to Main Board

Post Issue capital Between Rs. 10 crs to 25 crs - Voluntarily Migration Exceeds Rs. 25 crs - Mandatory Migration

Market Making

For Minimum 3 years from date of listing Inventory of Market maker should be at least 5% of proposed securities listed Promoters shares can’t be

• ffered to market maker

during 3 years.

Lock – in

Promoters holding up to 20% Post Issue Capital to be locked in for a period

• f 3 years

Entire Pre Issue Capital (Incl persons other than promoters) to be locked in for 1 year Locked-in shares permitted to be transferred inter se promoters incl. new promoter(s)

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KEY POST LISTING COMPLIANCES

Stock Exchange

Half yearly and annual results as per the Accounting Standards Financial results – Unaudited within 45 and audited within 60 days Half Yearly shareholding pattern within 45 Days

Website

Annual Report, Balance Sheets, P& L A/C Proceedings at AGM or EGM Notices and resolutions circulars , call letters

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MARKETING STRATEGY

• Managing senior level

meetings with QIBs/Mutual Funds/ Private Equity Funds/ Reputed Broking Houses/ Institutional Wealth Managers Public/Private/MNC Banks & NBFCs/ Key Research Analysts/ Family Offices

• Meeting with High Networth

Individuals (HNIs)

• Meeting Investor Community

Influencers

• Arranging Media Interaction

(Interviews)

• Meeting Brokers/Sub-Brokers
• Meeting groups of retail

investors

• Arranging Coverage in local

media

• Managing word-of-mouth
• Preparing Investor

Presentation

• Preparing Handy Documents

like 1/2 page flyers

• Assisting in preparing the

content to be distributed on Social Media

• Assistance in preparation of

the script for TV Advertisements/Investor Video

• Arranging Print/Electronic

Media meet

• Arranging Broker/ Analyst/

Investors Meet

• Scheduling One-to-One

Promoter Meetings

• Scheduling specific

Visits/Calls with investors

INSTITUTIONAL MARKETING RETAIL MARKETING POST DRHP ACTIVITIES POST RHP ACTIVITIES

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ABOUT US

• We, at Nirbhay, understand the complexity of every financial problem and the simplicity of
• solutions. ,We provide length-to-breadth one-stop solution to all financial needs of your business. We

laid down a strong belief that our services should be accurate, prompt and of absolute value to your

• business. Since the beginning, our vision has remained constant- To add value to your business and

fuel to your ambitions.

• To name, we offer our clients transparent advisory services on matters related to Loan Syndication,

Corporate Restructuring, Placement

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Equity / Debt, M&A, Financial Restructuring, Project Management, Capital Structuring, Issue Advisory and other allied services.

• wing to the Intricate research and data deliverance, we have successfully facilitated
• ver Rs 5000

crores funding. We have leverage in terms of widespread contacts in the industry and broad clientele base across the nation and abroad thus distinguishing us and our services from the rest.

• After all, it’s not just a piece of advice we offer, it’s a solution.

CONTACT DETAILS

Nirbhay Capital Services Pvt. Ltd. Corporate Identity Number (CIN): U67120 GJ20 0 6PTC0 4798 5 201, Maruti Crystal, Opposite Rajpath Club, S.G. Highway, Ahmedabad-380054. Phone No. : +91 79 26870649 FAX : +91 79 26870228 Email : info@nirbhaycapital.com Contact Person: Mr. Akshesh Dave

THANK YOU